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California Governor Arnold Schwarzenegger has finally warned state legislators in a tone of terse ultimatum that unless they reach a deal within one week to repair California's costly Workers' Compensation system, he will bypass lawmakers and ask voters to fix the problem with another ballot initiative.

"If we don't come to an agreement this coming week, then it's over, and then we will go to the ballot," Schwarzenegger said last Friday, March 19th, at a manufacturing plant where he collected signatures to place an initiative before voters in November.

The move came less than a month after Schwarzenegger won approval for a $15 billion budget bailout plan from the constituents who propelled him into office.

Businesses have long complained that Workers' Compensation costs are jeopardizing jobs and pushing companies out of the state. But Democrats argue the GOP proposals to reform the program would harm injured workers without guaranteeing employer savings.   But, Schwarzenegger believes the risk is worth it; as he is worried mostly about California economic competitiveness, for without jobs and economic growth there won't be workers to injure.  His attitude appears to carry a "horse before the cart" philosophy.   

The Assembly's senior Democrat, Speaker Fabian Nunez, accused Republicans of trying to block an agreement on Workers' Compensation so they can campaign on the issue in the fall.

Nunez said Friday the two sides were nearing an agreement but added that Schwarzenegger was sending "an odd message, when on one hand you are negotiating an agreement ... but at the same time you are saying you want to collect the (ballot) signatures."

The governor signed a petition in front of a battery of TV cameras, then urged residents to do the same when they encounter signature-gatherers. He boasted that if the measure goes to voters, "I know we will win."

In his State of the State speech in January, the governor threatened to push a petition campaign if lawmakers did not approve legislation by March 1 that would provide significant savings for employers. That deadline passed without a deal, but legislators have continued to talk, because he extended the deadline to March 31st. 

So, it appears that with his current bravado he is putting out the message that this extended deadline will not be extended again: it is truly his drop-dead deadline.